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Aug 20, 2008

Security of Tenure (Art. 279) – right of employees to be secure in their employment and not to be removed except for a just or authorized cause

  1. under the Constitution – all workers
  2. under the Labor Code – regular employees
  3. but even project, seasonal or contract employees are entitled to security of tenure for the duration of the project, season or contract

  1. reinstatement
  2. no loss of seniority rights and other privileges
  3. full backwages, inclusive of allowances
  4. other benefits or monetary equivalent computed from time his compensation was withheld from him up to the time of his actual reinstatement

Q: When is reinstatement no longer possible?
A: Reinstatement may no longer be possible if due to strained relations between the worker and the employer, reinstatement is not practicable. In that case, worker is entitled to separation pay in lieu of reinstatement. Another instance is if employee suffers from a disability which impairs his earning capacity or he has attained the age of retirement. When the position has already been abolished, reinstatement is no longer possible. Other such reasons are closure of department or section or of the entire business, sale, bankruptcy, insolvency, etc.

Kinds of Employment

1. Regular – where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer (Art. 280, par. 1)
- reasonable connection between the particular activity performed by the employee in relation to the usual business or trade of the employer

  • by nature of work
  • by years of service

2. Project – employment is fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee (Art. 280, par. 1)

3. Seasonal – where work or services to be performed is seasonal in nature and the employment is for the duration of the season (Art. 280, par. 1)

4. Fixed-Term – employment is only for a specified period of time; he is not regular but is deemed regular in two senses: (a) nature of his work is necessary or desirable in the principal business of the employer; and (b) he enjoys security of tenure during the limited time of his employment

5. Casual – not covered by the preceding paragraph; employee who has rendered at lease one year of service, whether such service is continuous or broken, shall be considered a regular employee with respect to the activity in which he is employed and his employment shall continue while such activity exists (Art. 280, par. 2)
- “principle of repeated hiring”

6. Probationary – not exceeding six months from the date the employee started working (Art. 281)
  • apprenticeship agreement stipulating a longer period
  • employees in private schools
- FULL-TIME TEACHER: 3 consecutive years of satisfactory service (primary to high school); 6 consecutive years of satisfactory service (tertiary level)

Full-time Teacher – one whose total working days is devoted to the school, has no other regular remunerative employment, and is paid on a regular monthly basis regardless of the number of teaching hours; and that in college, the normal teaching load of a full-time teacher shall be 18 hrs/month

  • the employee must be informed of his probationary status at the time of engagement, otherwise he is considered regular from the beginning
  • the employee must be informed of the reasonable standards at the time of his engagement, otherwise he is considered regular from the beginning
  • if allowed to work beyond the probationary period, he shall be considered regular

Just Causes for Termination (Art. 282) and Procedure

1. serious misconduct

Misconduct – improper or wrongful conduct; transgression of some established and definite rule of action, a forbidden act, a dereliction of duty, willful in character, and implies wrongful intent and not mere error in judgment

- to be serious, must be of such grave and aggravated character and not merely trivial and unimportant and must be in connection with the employee’s work to constitute a just cause for his separation

2. willful disobedience
- insubordination

  • reasonable and lawful order
  • sufficiently known to the employee
  • in connection with his duties

3. gross and habitual neglect

Gross Negligence – want or absence of or failure to exercise slight care or diligence or the entire absence of care

4. fraud
5. willful breach of the employer’s trust
6. commission of a crime or offense
7. other analogous causes
- e.g. dangerous drugs law, closed-shop agreement, illegal acts during strike, knowingly participating in illegal strike, defiance of RTWO, sexual harassment

PROCEDURE (2-notice Rule):
  1. written notice to worker, specifying ground for termination with opportunity to be heard
  2. hearing or conference; investigation
  3. written notice of termination

NOTA BENE: Non-compliance with the 2-notice rule will make the employer liable for nominal damages in the amount of P30,000.

Authorized Causes and Procedure

1. closure of establishment and reduction of personnel (Art. 283)
  • installation of labor-saving device
  • redundancy – where the services of an employee are in excess of what is reasonably demanded by the actual requirements of the enterprise
  • retrenchment to prevent losses - cost-cutting measure made immediately necessary by business reduction or reverses
  • closing or cessation of operation

- INSTALLATION/REDUNDANCY: 1 mo pay/1 mo pay for every yr of service, whichever is higher
- RETRENCHMENT/CLOSURE: 1 mo pay/1/2 mo pay for every yr of service, whichever is higher

NOTA BENE: A fraction of at least 6 mos is equivalent to 1 mo.

2. disease (Art. 284)
- employee suffering from any disease and whose continued employment is prohibited by law or is prejudicial to his health as well as to the health of his co-employees

- REQUISITE: certification by competent public health authority that disease is of such nature or at such a stage that it cannot be cured within a period of 6 mos even with proper medical treatment

- 1 mo pay/1/2 mo pay for every year of service, whichever is higher

  1. written notice to employee 30d prior to date
  2. written notice to regional office of DOLE 30d prior to date

NOTA BENE: Non-compliance with the notice, there is violation of due process, even if the dismissal is valid because it is for an authorized cause. The employer is liable to pay nominal damages of P50,000.

Consequence of Termination by Employer

1. if employer does not comply with due process, liable to pay nominal damages
2. employer must pay separation pay

  • separation pay under Art. 283 and Art. 284
  • separation pay as financial assistance, as an act of social justice, even in cases of legal dismissal under Art. 282
  • separation pay in lieu of reinstatement
  • separation pay as an employment benefit

Termination by Employee (Art. 285)

1. without just cause – 30d written notice; if without notice, employer may hold employee for damages
2. just causes
  • serious insult
  • inhuman and unbearable treatment
  • commission of a crime or offense
  • other causes analogous

Constructive Dismissal – a quitting because continued employment is rendered impossible, unreasonable or unlikely, as, an offer involving a demotion in rank and a diminution in pay; amounts to illegal dismissal

- distinguish from “floating status” or suspension of employment under Art. 286 because it is temporary in nature; if the suspension is for more than 6 mos, then it amounts to constructive dismissal


The bona fide suspension of the operation of a business or undertaking for a period not exceeding six (6) months, or the fulfillment by the employee of a military or civic duty shall not terminate employment. In all such cases, the employer shall reinstate the employee to his former position without loss of seniority rights if he indicates his desire to resume his work not later than one (1) month from the resumption of operations of his employer or from his relief from the military or civic duty.

NOTA BENE: A case for illegal dismissal within the 6-month period is premature. The employee must wait until the period expires before filing a case for illegal dismissal.


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